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Consumer credit: borrower's insurance

Verified 09 June 2020 - Directorate for Legal and Administrative Information (Prime Minister)

Borrower insurance is not required for consumer credit. However, the lender may require you to take it before giving you the credit. This insurance protects you against financial risks related to death and disability. If you have difficulty finding insurance because of serious health problems, you can use the agreement Aeras: titleContent..

Often, the institution that gives you the consumer credit will send you an insurance proposal along with the loan offer.

Insurance is not compulsory in the area of consumer credit. So you can decide not to insure yourself. However, it should be noted that the denial of insurance may negatively affect the decision to grant the loan or the interest rate.

In addition, the lender may make the purchase of insurance a mandatory condition for the granting of the loan.

If you take out insurance when it is not imposed by the lender, you can choose the contract that best covers you. You must compare your lender's proposal with those that exist on the market. Insurers have an obligation to clearly indicate in their advertisements and contracts the elements that make it possible to assess the cost of their benefits.

conclusion

The insurer must send you a proposal for insurance that includes the following information:

  • Guarantees for which it grants coverage
  • Conditions for triggering
  • Exclusions
  • Monthly contribution amount over total loan term

The contract is concluded by signing the insurance proposal.

This proposal can be found in the advance offer of credit, for the insurance of the lending agency. Payment of the contribution must be made at the time of signature of the advance offer of credit, unless otherwise specified by a payment in 1to release of funds, for example.

Termination

Optional insurance

You can terminate the contract at the annual maturity. You must send a registered letter or a registered electronic mail to the insurer at least 2 months before the due date.

Compulsory insurance

If the borrower's insurance was a condition for granting the credit, you cannot terminate it unless the lending organization agrees.

You can choose the risks you want to insure, from those offered by the insurer:

  • Insurance death is used to protect your heirs from credit repayment if you die.
  • Insurance illness and disability waives the payment of monthly payments in case of illness.
  • Insurance loss of employment relieves you from paying monthly payments in case of unemployment.

General rule

The insurer has the right to ask you to complete a medical questionnaire, if you subscribe to an insurance that covers health risks (illness, disability, death). This questionnaire must be completed in good faith..

Any omission or misrepresentation may result in the blocking of guarantees or even the cancelation of the contract in case of bad faith.

The insurer reviews your questionnaire responses and assesses the risk to be covered.

Cases of persons with "aggravated risks"

Persons with or having had serious health problems are generally considered to have aggravated risks by insurance.

However, if you are in this case, you can benefit from the Aeras convention.. This agreement allows you not to complete a medical health questionnaire.

However, the following 3 conditions must be met:

  • The maximum amount of consumer credit must not exceed €17,000
  • The maximum loan term must not exceed 4 years
  • You must be 50 years of age or older at the time of filing.

You will be required to make an Honor Statement that indicates that you do not have loans that total more than €17,000..

If one of these conditions is not met, you will have to complete the medical questionnaire related to the insurance application.

Please note

the Aeras Convention incorporates right to be forgotten for people cured of cancer whose treatment has been completed for at least 15 years. These people do not need to report it to the insurer. They may not be overcharged or excluded from the guarantee.